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View all search resultsP2P lending surges in March, but bad loans still high
The bad loan rate began to spike in November 2025 and now hovers above 4 percent, while the fintech sector has come under pressure recently following the KPPU's ruling on monopolistic practices related to interest rates.
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Stock illustration of financial technology (fintech) (Shutterstock/-)
I
ndonesia’s peer-to-peer (P2P) lending industry posted stronger growth in March but bad loan levels remained stubbornly high, hovering near the warning threshold set by regulators.
Agusman, supervisor for multi-finance, venture capital and other financial services at the Financial Services Authority (OJK), told a press conference on Tuesday that the outstanding balance of P2P lending surged 26.35 percent year-on-year (yoy) to Rp 101.03 trillion (US$5.8 billion) in March.
He also said the industry’s lending default rate also increased, however, with the ratio of TWP90 loans, or loans 90 days past due, standing at 4.52 percent of total loans for the same month, a sharp increase from 2.77 percent recorded in March 2025.
The ratio of bad loans began to spike in November last year and has since hovered at above 4 percent, moving closer to the OJK’s “safe” threshold of 5 percent.
In its circular No. 19/2025, the OJK introduced a regulation aimed at strengthening risk mitigation and improving the health of the P2P lending industry that will slash borrowers’ maximum debt-to-income ratio from 40 to 30 percent this year.
The regulation is to be enforced gradually, while the current focus is on strengthening industry oversight and on the “risk assessment and credit scoring system”.
Read also: OJK threatens ‘corrective measures’ as P2P defaults rise
